VANCOUVER, British Columbia, Sept. 15, 2021 (GLOBE NEWSWIRE) — Sonoro Gold Corp. (TSXV: SGO | OTCQB: SMOFF | FRA: 23SP) (“Sonoro” or the “Company”) is pleased to report the results of an independent Preliminary Economic Assessment (“PEA”) including an updated Mineral Resource Estimate completed on the Company’s Cerro Caliche gold project located in Sonora State, Mexico.
The PEA has been prepared in accordance with the requirements of National Instrument 43-101 by D.E.N.M. Engineering Ltd. of Burlington, Ontario (“D.E.N.M.”), with an updated resource estimation completed by Micon International Ltd. of Toronto, Ontario (“Micon”) and metallurgical testing completed by McClelland Laboratories Inc. of Sparks, Nevada (“McClelland”).
PEA Highlights:
- Pre-Tax NPV (5% discount rate) of US$68.7 million and an IRR of 52.7% with a price of US$1,750 per ounce of gold and US$22.00 per ounce of silver.
- After-Tax NPV (5% discount rate) of US$41.5 million with an IRR of 32.4% with a price of US$1,750 per ounce of gold and US$22.00 per ounce of silver.
- 7 years Life of Mine (“LOM”) producing 323,500 ounces (“oz”) of gold equivalent (“AuEq”)
- Gold recovery of 74% and silver recovery of 27% produced from a 3-stage crushing circuit, crushing the ore to p80 of ½”.
- LOM annual average production of 45,700 oz AuEq.
- Years 1 to 3 annual production of 56,500 oz AuEq with average grade of 0.51 g/t AuEq.
- Initial CAPEX costs of US$32.2 million, including US$3.8 million in contingency.
- Sustaining capital costs of US$4.8 million.
- OPEX costs of US$1,227/oz AuEq.
- All-In Sustaining Cost (“AISC”) of US$1,462/oz AuEq.
- Payback period of 2.2 years.
Updated Mineral Resource Estimate Highlights at 0.207 g/t Au Cut-off:
- Measured and Indicated Mineral Resources of 349,000 ounces of gold at a 0.41 g/t Au grade.
- Updated Inferred Mineral Resources of 71,000 ounces of gold at 0.40 g/t Au grade.
Also noted in Micon’s report, a range of the potential mineralization that may conceptually exist outside of the resource pit shells has been included in the report. Utilizing the same 0.207 g/t Au cut-off grade as the current resource estimate, the range of the potential mineralization is believed to be from 19,250,000 to 34,370,000 tonnes containing:
- 204,000 to 365,000 ounces of gold.
- 1,683,000 to 3,005,000 ounces of silver.
The reader is cautioned that the potential mineralization ranges are conceptual in nature and that despite being based on a limited amount of exploration drilling and sampling outside the current resource pit shells, it is uncertain that further exploration will result in the mineralization targets being delineated as a mineral resource.
“The PEA really highlights the intrinsic value and potential economic viability of the Cerro Caliche project,” said Mel Herdrick, VP Exploration of Sonoro Gold. “Considering only 30% of the mapped mineralized zones have been drilled and assayed to date, I believe the PEA also justifies resuming drilling this fall to continue expanding and categorizing the project’s oxide gold mineralization.”
Kenneth MacLeod, President and CEO of Sonoro Gold, stated, “We are extremely pleased to announce the completion of the PEA. The results support management’s continuing strategy to develop a Heap Leap Mining Operation (HLMO) with a targeted operating capacity of up to 15,000 tons per day (tpd). We are preparing to resume drilling this fall to investigate the prospect for expansion of the mineralized zones to extend the potential life of the proposed future mining operation.”
John Darch, Chairman of Sonoro Gold, commented, “The completion of the PEA is a decisive step in our efforts to unlock the potential value of Cerro Caliche and deliver value to our shareholders. The PEA demonstrates the potential for economic viability which we hope will support our strategy to establish an initial mining operation that will generate the funds to continue exploring and developing the project’s potential. As we continue working towards these goals, Management believes we will continue building additional value for our shareholders.”
PEA Summary
The PEA is preliminary in nature and includes inferred resources that are considered too speculative to have the economic considerations applied to them that would enable them to be categorized as mineral reserves and there is no certainty the estimates presented in the PEA will be realized. The full PEA will be filed on SEDAR at www.sedar.com and Sonoro’s website www.sonorogold.com within 45 days of the issuance of this news release.
Table 1: Key Economic Parameters of PEA
| Assumption / Results | Value | ||
| Total Tonnes Processed | 31.5 M | ||
| Total Tonnes Waste | 65.5 M | ||
| Strip Ratio | 2.1 | ||
| Gold Grade (g/t) | 0.41 | ||
| Silver Grade (g/t) | 4.05 | ||
| Gold Recovery | 74 | % | |
| Silver Recovery | 27 | % | |
| Gold Price (US$/oz) | $1,750 | ||
| Silver Price (US$/oz) | $22 | ||
| Annual Gold Equivalent Production (Ounces) | 45,700 | ||
| Total Gold Equivalent Production (Ounces) | 323,500 | ||
| Net Revenue (Gold and Silver) (US$ millions) | $566.2M | ||
| Initial Capital Costs (US$ millions) | $32.2 | ||
| Sustaining Capital Costs (US$ millions) | $4.8 | ||
| LOM Operating Costs (US$ millions) | $396.9 | ||
| Operating Cash Cost per AuEq ounce | $1,227 | ||
| All in Sustaining Cost per AuEq ounce | $1,462 | ||
| Mine Life | 7 years | ||
| Average Process Rate (tonnes per day) | 15,000 | ||
| Pre-Tax NPV (5% discount) (US$ millions) | $68.7 | ||
| After-Tax NPV (5% discount) (US$ millions) | $41.5 | ||
| Pre-Tax IRR | 52.7 | % | |
| After-Tax IRR | 32.4 | % | |
| Payback Period | 2.2 years | ||
Table 2: Gold & Silver Price Sensitivity Analysis
| Sensitivity | US$1,700 Au US$20 Ag |
US$1,750 Au US$22 Ag |
US$1,800 Au US$24 Ag |
US$1,900 Au US$26 Ag |
US$2,000 Au US$28 Ag |
||||||||||
| After-Tax NPV (5%) | $ | 32.6 | $ | 41.5 | $ | 50.4 | $ | 67.1 | $ | 83.9 | |||||
| Pre-Tax NPV (5%) | $ | 55.0 | $ | 68.7 | $ | 82.5 | $ | 108.3 | $ | 134.1 | |||||
| After-Tax IRR | 26.8 | % | 32.4 | % | 37.9 | % | 48.1 | % | 58.0 | % | |||||
| Pre-Tax IRR | 43.9 | % | 52.7 | % | 61.3 | % | 77.1 | % | 92.4 | % | |||||
| After-Tax Payback | 2.6 | 2.2 | 1.9 | 1.5 | 1.2 | ||||||||||
Table 3: Operating & Capital Sensitivity Analysis
| Sensitivity | -20% | -10% | Base Case | 10% | 20% | ||||||||||
| Operating Costs – Pre-tax NPV (US$ million) | $ | 129.8 | $ | 99.3 | $ | 68.7 | $ | 38.1 | $ | 7.6 | |||||
| Operating Costs – IRR | 93.1 | % | 73.2 | % | 52.7 | % | 31.7 | % | 10.2 | % | |||||
| Capital Costs – Pre-tax NPV (US$ million) | $ | 75.7 | $ | 72.2 | $ | 68.7 | $ | 65.2 | $ | 61.7 | |||||
| Capital Costs – IRR | 67.8 | % | 59.6 | % | 52.7 | % | 47.0 | % | 42.1 | % | |||||
Capital Costs
The estimated capital costs for the Cerro Caliche Gold Project are based on an open pit mining and heap leach operation processing five million tonnes per year and utilizing contract mining. An initial capital expenditure is estimated at US$32.2 million for the construction period, including 15% contingency. An additional US$4.8 million is estimated for sustaining capital and US$2.9 million is estimated for reclamation.
Capital cost estimates are based on industry standards and were developed using quotes provided by mining contractors and specialists experienced in mining development in Mexico.
Table 4: Capital Costs
| Initial Capital Costs | Costs (US$M) | |
| Direct Facility Costs | $19.1 | |
| Indirect Facility Costs | $1.4 | |
| Engineering and Procurement | $3.4 | |
| Pre-Stripping and Mine Development | $0.2 | |
| Infrastructure | $4.2 | |
| Subtotal | $28.4 | |
| Contingency | $3.8 | |
| Total Initial Capital Costs | $32.2 | |
| Sustaining Capital Costs | Costs (US$M) | |
| Leach Pad Expansion | $3.3 | |
| Equipment and Other | $1.5 | |
| Total Sustaining Capital Costs | $4.8 | |
| Total Capital Costs | $37.0 | |
| Reclamation Capital Costs | Costs (US$M) | |
| Environmental | $2.3 | |
| Engineering and Procurement | $0.3 | |
| Subtotal | $2.6 | |
| Contingency | $0.3 | |
| Total Reclamation Costs | $2.9 | |
Operating Costs
Cash costs for Cerro Caliche for the life of mine are estimated at US$396.9 million or US$1,227 per gold equivalent ounce and include mining, crushing and processing as well as maintenance and administration costs. All-in Sustaining Costs for the project for the life of mine are estimated at US$489.3 million or US$1,462 per gold equivalent ounce and include operating costs, sustaining capital, reclamation, taxes, royalties and refining charges.
Royalties include a 2% NSR to certain landholders and taxes include payments to the Mexican government for mining royalty and specific mining related taxes. Refining costs include shipping loaded carbon to a 3rd party processing facility as well as costs for processing the carbon and production of doré bars.
Open pit mining will be undertaken by a contractor and carried out by drill and blast conventional loading and truck haulage to the crushing facility. An estimated mining cost of US$1.90 per tonne includes drilling, blasting, hauling waste and mineralized ore to the heap leach area.
The Processing facilities at Cerro Caliche will be comprised of a crushing circuit where mineralized material is processed through a three-stage crushing plant to produce material that is has p80 of ½” (80% passing) method. The material is then conveyed and stacked in a conventional heap leach pad and irrigated with a low concentrate cyanide solution. Solution collected from the leach pad is then directed through a system of ditches to the processing ponds where it passes through a series of carbon columns. Gold and silver impregnated carbon is collected periodically from the columns and then dried and shipped to a 3rd party processing facility for stripping and doré bar production. An estimated processing cost of US$5.70 per tonne operating costs includes crushing, leaching, assaying, carbon handling and labour.
Operating cost estimates are based on industry standards and were developed using quotes provided by mining contractors and specialists experienced in mining development in Mexico.
Table 5: Operating Costs
| Operating Costs | LOM (US$M) | US$/oz AuEq | ||
| Mining | $174.7 | $540 | ||
| Processing | $204.9 | $633 | ||
| Administration | $17.3 | $53 | ||
| Total Cash Costs | $396.9 | $1,227 | ||
| All-in Sustaining Costs (AISC) | $489.3 | $1,462 | ||
Mineral Resource Estimate
As part of the PEA, an updated Mineral Resource Estimate was completed to incorporate geological data from the Company’s 2020 and 2021 drilling campaign. The resource estimate is based on Sonoro’s geological interpretation of the deposit that established six geological domains….
Read More:Sonoro Announces Positive PEA Results and Updated Mineral
2021-09-15 16:44:12